"Elementary Particles" price charts


Analysis of classical figures in a new light

Consider the classic analysis of candles in light of the proposed methodology. We will try to determine why not fire the classic formation. Pay special attention to the reversal pattern.

For example, look at the model of the evening star doji (Evening Doji Star) and Evening Star (Evening Star), which are considered classic reversal. If you look at them from the perspective of the proposed algorithm, it turns out that the first two candles form a true combination of Rally, the third candle should be ignored. It did not give any signal - either the continuation or a reversal of the existing trend.

Take model bearish engulfing (Engulfing Bearish Line), and the curtain of dark clouds (Dark Cloud Cover). Each of them is represented only by two candles. The first corresponds to the formation Rally, and the second - the formation Outside.

The four above-mentioned figures are considered in the analysis of candles reversal, but often they are not. The proposed method treats them as formations continue or pause. However, this contradiction could be resolved. Strengthen requirements for classic shapes. We assume that this was a reversal, when prices fell below the low of the first candle. The proposed algorithm is a breakdown of the true minimum Rally. Thus the classical formation of candles can be seen from the perspective of the new algorithm. On the one hand, drastically reducing their number, and the other - lost the need to remember a description of all the models. For the construction of the original color of colored formations candles should be black. If all of the formulas are correct, then the "accession" the expert to appear green, red and black candles. Graph is based on volume.

The emergence of green candle gives a bullish signal. If in the future there are black candles, it is a neutral signal. Trend continues. The appearance of a red candle indicates that the bullish momentum has exhausted his strength. But this is not a signal for a trend reversal, it must be determined by other methods. For a down-trend line of argument is reversed.

The advantages of the presented methods:

The presented method has several advantages.

1. Price movement gained structure. Now, the whole graph can be represented in the form of upward and downward momentum.

2. "Elementary particles" to determine the structure consists of two candles. To get the signal there is no need to wait for five periods.

3. Possible candlestick formations only four. They are easy to remember and even easier to apply.

4. Using pulses, easy to apply the Elliott Wave Theory. Each wave is a combination of pulses, "tide" and "flood".

5. When using the classical methods of analysis can spark the totality of existing formations lead to the proposed four. A signal transmitted to the classic formation, you can also filter the rules of the new algorithm.

6. Determine the pulse signals of price movement can be used to determine the overall trend (trend). This requires, for example, the daily chart to build a weekly chart. Found momentum in the weekly chart is the trend for the day.

7. No need to use technical indicators. Analysis of the relative position of candles can keep the pulse of price and maximize profits.

8. Support and resistance levels are defined as the minimum and maximum of the true formation.

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Formulas for MetaStock

To build on the chart formations can be examined using the program MetaStock 7.0 (or other versions). We make use of the function of "Advisor» (Expert Advisor). In the "Tools" menu, select «Expert Advisor», open the window and select the item «New». A window «Expert Editor - <New Expert>». Choose option «Highlights» and point «New». In the new window, called the «Expert Highlights Editor» in section «Name» print «Bull», choose green. And in the «Condition» Make suggestions below formula. By clicking "OK" once again find ourselves in a box «Expert Editor - <New Expert>» and selecting «New», enter the data for «Bear». Color set to red.

Reaction formula Rally and excluding the volume of transactions:

«Bull» lowstop: = If (Rally (), Ref (L, -1), PREV); highstop: = If (Reaction (), Ref (H, -1), PREV); C> Lowstop AND C> Highstop
«Bear» lowstop: = If (Rally (), Ref (L, -1), PREV); highstop: = If (Reaction (), Ref (H, -1), PREV); C <Lowstop AND C <Highstop
(Prices are used to analyze Close)
«Bull» lowstop: = If (Rally (), Ref (L, -1), PREV); highstop: = If (Reaction (), Ref (H, -1), PREV); L> Lowstop AND H> Highstop
«Bear» lowstop: = If (Rally (), Ref (L, -1), PREV); highstop: = If (Reaction (), Ref (H, -1), PREV); L <Lowstop AND H <Highstop
(Prices are used for the analysis of High and Low)

The proposed formation can be built based on the level of transactions. In this case the formation is considered to be true if the amount of the second candlestick formations more than the amount first.

Rally formula and Reaction to the volume:

«Bull» lowstop: = If (RallyWithVol (), Ref (L, -1), PREV); highstop: = If (ReactionWithVol (), Ref (H, -1), PREV); C> Lowstop AND C> Highstop
«Bear» lowstop: = If (RallyWithVol (), Ref (L, -1), PREV); highstop: = If (ReactionWithVol (), Ref (H, -1), PREV); C <Lowstop AND C <Highstop
(Prices are used to analyze Close)
«Bull» lowstop: = If (RallyWithVol (), Ref (L, -1), PREV); highstop: = If (ReactionWithVol (), Ref (H, -1), PREV); L> Lowstop AND H> Highstop
«Bear» lowstop: = If (RallyWithVol (), Ref (L, -1), PREV); highstop: = If (ReactionWithVol (), Ref (H, -1), PREV); L <Lowstop AND H <Highstop
(Prices are used for the analysis of High and Low)